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Dark Fiber: A Case In Point
Anonymous Coward writes "CNN has posted a story regarding the overabundance of fiber lines that were laid during the 90s gold rush along Oregons Interstate 5 corridor. While over 140,000 miles of fiber has been laid 95 percent of the fiber goes unused and roughly half of the companies who laid the fiber are now gone. The article goes on to further say that even with all that fiber, there is little availability to the consumer because either the local connections aren't there or, because of monopolization by phone companies, too expensive. Even for businesses."
Wrong. This is proof of not being able to afford to light up the fiber. There's a reason why all of it was put in the ground in the 90's. That's because people were pouring money into it without thinking. That gave the companies the money to lay it. Now, the economy is flat, and companies are barely making money on broadband as it is. This isn't some ploy to personally screw you over.
Shortly after I moved into my house, almost five years ago, Bellsouth paid me $400 so that they could lay fiber along the roadside in my front yard.
I live in HIGHLY rural area, consisting mostly of lakehouses used as weekend getaway accomodations.
At the time, I thought that the installation of fiber in my front yard might eventually lead to allowing me to get a really high-speed broadband connection. To this day, however, if I were to call Bellsouth, the best they could offer is an ISDN connection, as DSL is unavailable.
But, I guess that it leaves Bellsouth's options open for the future.
Fast-forward 30 years, and they were all running at capacity. The fiber is there, it's not going to go away. 5, 10, maybe 15 years down the road, someone who picks it up cheap now will make a fortune off of it.
--Dave
Even applying conservative estimates to costs of construction, the companies spent more than $570 million laying long-distance fiber cables across Oregon, and they shelled out at least $265 million more equipping the 5% of fiber that is used
It costs almost 10 times as much to light a fiber as it does to lay it according to these numbers. Most of the cost in laying fiber isn't the fiber itself, but the labor and the property rights involved in doing it. So, you may as well lay 95% more fiber than you really need because you might need it some day and it doesn't cost you that much more. You'd be insane to try to terminate all of those fibers though since they cost so damn much.
Furthermore, bandwidth is a matter of supply and demand, and as long as demand isn't increasing, increasing supply will force down prices and make your business less profitable. Let's say everybody started needing DS-3 speeds into their home. Somebody would come in and offer that speed for a hefty premium, but as demand for that service built up, people would come into lower the prices to get into that market. Eventually you end up paying the same amount for your DS-3 as you did for your DSL and you've got a few more of those fibers on the coast glowing.
The problem is that there's nothing driving bandwidth demand substantially above what it is right now. Most people will tolerate modem speeds, and those that won't are mostly pretty happy with DSL or cable. A few of us want more bandwidth, and because we aren't the majority of users we will have to pay handsomly for it. As long as the majority of users are content with the bandwidth they have there is no incentive to expand their networks.
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companies are barely making money on broadband as it is.
If they'd charge based on usage and eliminate all the restrictions on home/business usage (no servers, etc) they might be able to make some money.
The story isn't complete.
Much of the fiber that was laid along the I-5 corridor was expected to stay dark for a long time. It doesn't cost that much more to lay excess capacity, once you've committed to buying the rights of way and doing the trenching. The story is weak for suggesting that the dotcom crash caused all the dark fiber-- it didn't. Depending on which segment you chose to look at, anywhere from 50% to 75% or more of the fiber would still be dark even if the dotcoms and the economy had continued to boom along.
The story is also weak for implying that this extra capacity is wasted. That isn't so; it will be there when the need develops. My town has twice reviewed the costs and bennies of lighting up some of that fiber to attract new businesses. So far other problems in the economy have ruled against it, but sooner or later a number of towns in southern Oregon and northern California will do this.
Another weakness in the story is its implication that the dark fiber has cost a lot of jobs in Oregon. There has been much moaning and gnashing of teeth around here because all those cable laying jobs have gone away, but that didn't happen because of dark cable. That happened because, gee, once the cable's in place I guess we don't need any of these ditch-diggers any more, huh?
I think the story is right on the money that too many companies were chasing this business opportunity.
i agree. my dad was the project manager for king county's municipal fiber optic system. he went into great detail about planning for the future. did you know that putting fiber through downtown seattle is an absolute bitch? you have to figure out where you can run fiber, and how to get it across major highways in downtown. this involves permits, buyouts of pipelines, co-leases and whatnot. you expect 400% increase in bandwidth annually for twenty years, and as a result, put ALOT of fiber in the ground. when the demand increases, you light up a new strand of fiber. it only costs about 10% more overall to pull 40 (or 200, or however many you need) strands of fiber instead of the 2 you actually need at the time, once you factor in the cost of engineering how the hell you're going to put it there in the first place.
moox. for a new generation.